The tax burden on banks over the period 2006-2014

Giacomo Ricotti (), Marco Burroni (), Vincenzo Cuciniello, Elena Padovani (), Elena Pisano () and Stefania Zotteri ()
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Giacomo Ricotti: Banca d'Italia
Marco Burroni: Banca d'Italia
Elena Padovani: Banca d'Italia
Elena Pisano: Banca d'Italia
Stefania Zotteri: Banca d'Italia

No 314, Questioni di Economia e Finanza (Occasional Papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: Following the establishment of the Single Supervisory Mechanism (SSM), concerns about having a level playing field become more important due to the heterogeneity in bank taxation rules across Europe: measuring the tax burden can provide a first rough measure of the extent of heterogeneity across countries. After a review of the main differences in banks taxation between Italy, France, Germany, Spain and the UK, the paper provides estimates for the tax burden and deferred tax assets in these countries over the years 2006-2014; the impact of differences in taxation on bank profitability is also examined. Moreover, the paper carries out a more in-depth analysis of Italian banks by considering both individual balance sheet data and aggregate tax return data. The impact of tax measures on financial stability and on profitability is further analysed. The comparative analysis points to a wide heterogeneity across countries in the tax treatment of the banking sector. This suggests that it would be advantageous to explore possible ways to make the tax systems of the countries participating in the SSM more homogeneous; a first step could be to harmonize tax bases.

Keywords: banking; taxation (search for similar items in EconPapers)
JEL-codes: G21 H25 H87 K34 (search for similar items in EconPapers)
Date: 2016-02
New Economics Papers: this item is included in nep-acc, nep-cba, nep-eec, nep-pbe and nep-pub
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Citations: View citations in EconPapers (1)

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